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ARM provides blue-prints that brands like HiSilicon acquire through licensing, and then they manufacture their own custom chips (like the Kirin 980) basis of those designs

This means, with ARM technology out of the picture, a processor like the Kirin 980 will cease to exist

Huawei may have a ‘plan B’ when it comes to making its own software following a recent US trade clampdown but designing home-grown hardware that would drive its future devices will be easier said than done. And if a new BBC report is anything to go by, Chinese conglomerate Huawei might just have found itself in a much hotter soup than what severed ties with Google, Intel and Qualcomm would bring combined. UK-based ARM, whose designs form the basis of nearly every mobile processor we see in the market today, has decided to halt “all active contracts, support entitlements, and any pending engagements” with Huawei, effectively killing the HiSilicon chip found inside majority of its phones as we speak.

To be clear, ARM doesn’t directly make mobile chips. Instead, it provides blue-prints that brands like HiSilicon acquire through licensing, and then they manufacture their own custom chips (like the Kirin 980) basis of those designs. This means, with ARM technology out of the picture, a processor like the Kirin 980 will cease to exist – it wouldn’t have been made in the first place. So, while the Kirin 980 already exists (and powers phones like the Huawei P30 Pro and the just announced Honor 20-series) and chances are Huawei may have already acquired necessary licensing from ARM to build its next-generation Kirin SoC, the future of the version(s) after it has been jeopardized. Until further notice.

A question arises, how does a Trump government directive that bars all US companies from engaging in trade with Huawei encompass a UK-based company (which is now owned by Japanese firm Softbank)? It doesn’t, until you come to know, that ARM’s designs contain “US origin technology” which is why it “believes it is affected by the Trump administration's ban.”

Moreover, while the Trump administration's ban gives a 90-day reprieve to Huawei to sort of ease into things (so it could possibly ensure existing devices aren’t affected), ARM seemingly isn’t giving any such relief – which means all ARM staff has been asked to cut all business ties with Huawei immediately. This reportedly includes “providing support, delivery technology (whether software, code, or other updates), engage in technical discussions, or otherwise discuss technical matters with Huawei, HiSilicon or any of the other named entities.”

Huawei is facing the heat for its alleged role in spying for the Chinese government. The US government, chaired by Donald Trump, has blacklisted Huawei - one of the repercussions to that was Google recently pulling all ‘business’ ties pertaining to Android with Huawei. Qualcomm and Intel have also done the same with regards to hardware properties. But the ARM fallout will undoubtedly be the biggest blow to Huawei - that aspires to be the world's largest smartphone company by 2020.